Asean urged to ride Sino-India growth

Strong China-India ties could usher in a golden century for Asia, and Southeast Asia should help bridge the two giant nations to reap the benefits and safeguard its own economic future, Singapore's foreign minister has said.

06 Sep 2005 11:02 GMT

Asean is being urged to integrate more and reap the benefits

George Yeo said the 10-country Association of Southeast Asian Nations (Asean) will use a December summit in Kuala Lumpur to draw up a plan to speed up Asia's integration and help Asean ride on China and India's growth.

"If China and India are able to maintain good relations with each other - and the signs are good - this will be a golden century for Asia," Yeo said in a speech on Tuesday in Kuala Lumpur at the Global Leadership Forum, a meeting of corporate leaders, government officials and academics.

"We have to think and act strategically so that Southeast Asia becomes a major intermediary between China and India," he said.

"In this way, the Chinese and Indian engines of growth will also pull us along."

Yeo said he believed English would eventually become the "de facto lingua franca for Asia".

Asean talks

Yeo also said Asean has begun free trade talks with the two giants, and must also improve transportation links and strengthen energy cooperation amid the currently unstable global oil supply.

"If China and India are able to maintain good relations with each other - and the signs are good - this will be a golden century for Asia"

George Yeo, Singapore Foreign Minister

Making it easier to fly between Asian countries would be an important step, the minister said.

"China has greatly liberalised its skies. India is liberalising too, although not fast enough," he said. "We must not be left behind in Asean, because good and cheap air links are absolutely essential for the operation of the modern economy."

"There are many things that we have to do to build the highways between China and India on land, at sea and in the air."

He said that Myanmar, which borders India and China, is key to improving transport links, and that Asean must ensure development in the military-ruled country.

Vested interests

Asean's energy strategy must factor in the needs of China, India and Japan to give them a vested interest in the region's security and development, he said, noting that there is already a proposal for Iranian gas to be piped through Pakistan to India, and through Myanmar to China.

Yeo said an inaugural East Asia Summit between Asean, China, Japan, Korea, India, Australia and New Zealand - to be held in conjunction with December's Asean summit - will accelerate economic integration and a new future for Asia.

But the Southeast Asian grouping must first hasten its own integration, he said.

"I doubt if Asean integration will ever reach even half the level of integration in Europe today," Yeo said.

However, he warned: "Either we become stronger as a region, or we will fragment."

Yeo said a team will be appointed to sketch a charter of rules to help build institutions that strengthen the region's future and create a strong Asean identity.

Protectionism

Also on Tuesday, EU Trade Commissioner Peter Mandelson said European countries had to learn to adapt in the age of globalisation and actively engage in trade and investment with new economic powers such as China and India.

"Political leaders in Europe have to be more creative and courageous ... we must resolve differences and come to a common view"

Peter Mandelson, EU Trade Commissioner

Mandelson urged European policymakers to learn a lesson from the textile crisis with China to reshape their thinking, saying protectionism is not the long-term answer to the rise of cheap imports.

"I hold to my view that the wrong answer would be to build new tariff barriers and to protect us behind unrealistic walls," he said in a speech at the Central Communist Party School in Beijing.

"Political leaders in Europe have to be more creative and courageous," he said.

"We must resolve differences and come to a common view, rather than asking the commission to try - inevitably without complete success - to reconcile irreconcilable demands.

"Europe has to develop a much more sophisticated response to the challenge of globalisation," he said.

He urged Europe to launch a drive to increase and promote more trade and investment with rising powers such as China and India, and to actively attract talent from these countries.